Impact of Israeli Iran airstrike causes New York stock market to start lower… International oil prices surge, Preference for safe assets strengthens

Israel Carried Out A Surprise Attack On Iran (Source: Reuters)

The news that Israel carried out a large-scale airstrike on Iran led the New York stock market to start on a downward trend. Geopolitical tensions are heightening further, reinforcing oil supply instability and the preference for safe assets.

As of 9:40 a.m. local time on the 13th, the Dow Jones Industrial Average was down 502.15 points (1.17%) to 42,465.47, the S&P 500 Index was down 43.26 points (0.72%) to 6,002.00, and the Nasdaq Index was down 136.72 points (0.70%) to 19,525.76.

Israel's airstrike targeted multiple strategic objectives in Iran, and as a result, Israel declared a national emergency. Iran has warned of retaliation, and the possibility of a full-scale Middle East war is creating tension throughout the market.

Due to this situation, international oil prices have surged. July delivery West Texas Intermediate (WTI) rose 7.66% from the previous day to $73.25 per barrel, and August delivery Brent oil rose 7.17% to $74.33. At the same time, gold prices rose more than 1%, highlighting renewed demand for safe assets, and the dollar also showed strength.

Adam Crisafulli, founder of Vital Knowledge, analyzed that “The market reaction is showing a predictable pattern of rising oil prices and falling stock prices.” He added, “However, Iran's ability for direct retaliation is limited, and the production increase stance of OPEC+ is moderating some of the excessive reactions.”

Donald Trump, U.S. President, repeatedly pressured Iran through Truth Social, saying, “You need to negotiate before you lose everything.” He maintained a strong stance, stating, “The next attack will be much more brutal.”

By industry, most sectors such as Finance (-1.8%), Technology (-0.8%), Consumer Discretionary (-0.7%), and Communication Services (-0.7%) are showing a downward trend, while only the Energy sector is rising by 1.3%.

As for individual stocks, luxury furniture retailer RH soared 23% after announcing a first-quarter surprise profit, while Adobe is down 7% due to concerns over the slowdown in subscription revenue growth, though its earnings exceeded expectations. DraftKings is down 0.8% following the announcement of the introduction of a transaction fee in Illinois.

The European stock market also showed a downward trend due to geopolitical uncertainties. The Euro Stoxx 50 fell 1.30%, Germany's DAX 1.12%, France's CAC 40 0.97%, and the UK's FTSE 0.20% respectively.